Climate change: Plan to squash emissions includes scrap-and-replace car scheme, huge fund for industry and agriculture, but no public transport subsidy
The Governments sprawling $2.9b plan to bring down emissions includes several carrots but few sticks. Here are the main points: Climate Change Minister James Shaw and Finance Minister Grant Robertson unveiled the Emissions Reduction Plan in Wellington on Monday, ahead of the Budget on Thursday. It funds a range of initiatives, including a $579m scrap-and-replace scheme that will see up to tens of thousands of low-income families trade in their older car for a cleaner alternative either an EV or a hybrid. More detail on this scheme will be released in the coming months. Families in most of the cities will be able to make use of kerbside food waste collection by 2030. And the Government is aiming to have half of all energy use emissions-free by 2035 not just electricity, but all energy. Huge funds are also allocated to help industry decarbonise and to establish a new agricultural emissions research centre with all the money coming from funds raised from the Emissions Trading Scheme, not general taxes. READ MORE: * EV-buying subsidies resurrected by $300m boost * Auckland transport plan: Low-income fare discounts, but emissions will keep rising * ACC, other big Crown agencies instructed to come clean on climate risk to bottom line * How to cut emissions from transport: ban fossil fuel cars, electrify transport and get people walking and cycling The polluters are paying, not households, Robertson said. Despite heavy speculation, the Government has not confirmed that it will continue to discount public transport use, despite the half-price subsidy driving increased use instead vaguely promising to make public transport more desirable. The Government has also opted not to go ahead with several of the bans floated by the Climate Change Commission in its advice on the plan. There is no stated ban on new gas connections, or on fossil fuel car imports just a ban on new fossil fuel baseload electricity generation that Labour had already campaigned on. Some of the most gas-guzzling cars do look set to be banned eventually as an emissions standard would make them impossible or very costly to import, but detail on this is lacking. Instead, the plan is rife with initiatives that are still being scoped or designed. The reductions achieved by the plan are weighted far more towards the second two emissions budgets across 2025-2035. In the first emissions period of 2022-2025 the range of initiatives is projected to reduce emissions by between 5.4 and 11.9 Mt C02e a reduction of 1.9%-4.1% of total emissions over that period. The energy sector and wider industry are expected to achieve the bulk of those emissions reductions, with Finance Minister Grant Robertson emphasising this would also reduce costs to consumers as energy inflation rises around the world. Just over $650m has been allocated to helping decarbonise industry over years, with a further $355m tagged to be used in the follow budget periods. This fund will be used to co-invest with businesses to replace coal boiler and other fossil fuel infrastructure. New coal boilers have been banned. Agriculture New Zealands largest emitting sector is not expected to reduce emissions dramatically in the first period, as they are not even pricing emissions until 2025. But the Government has allocated $339m for a new Centre for Climate Action on Agricultural Emissions, aimed at developing and commercialising products which help farmers reduce emissions. This is despite the sector not paying any money into the Emissions Trade Scheme which will fund this research. Transport, New Zealands second-largest emitting sector, is expected to do much of the heavy lifting, with 30 per cent of the light vehicle fleet electric by 2035. Initiatives to achieve this include the existing clean car standard and feebate scheme, as well as the new Clean Car Upgrade scrap and replace scheme. However, that pilot will only replace up to a maximum of 2500 cars at first about 0.06% of the 4 million-strong light vehicle fleet. Transport Minister Michael Wood said that the $569m of funding would be used to rapidly expand the scheme in the following years, to the tune of tens of thousands families. He said the income threshold would likely be at around the median household income. The Government is hoping that there will be less reliance on cars in general, with 20% fewer vehicle kilometres travelled by 2035. The plans to increase public and active transport are somewhat vague, with initiatives to increase e-bike usage or public transport still being scoped or investigated. It is noted that the work could include reducing public transport fares, alongside targeted public transport fare concessions. Robertson refused to confirm or deny whether the details of a public transport subsidy might be announced on Thursday at the Budget. Shaw said the plan showed that decarbonisation was both possible and affordable. The Emissions Reduction Plan will ensure New Zealand is on track to meet the climate targets this Government has put in place all while creating new jobs, improving our communities, and making life better for people. Prime Minister Jacinda Ardern was not able to attend the event as she is at home with Covid-19. In a statement, Ardern said addressing climate change would help bring down the cost of living. Reducing our reliance on fossil fuels will shield households from the volatility of international price hikes which reducing transport and energy bills, Ardern said. The Government had tagged about $4.5b from future Emissions Trade Scheme revenues, but has left $1.6b to spend later on. National leader Christopher Luxon said too much of the spending would go to corporate wlefare. "The Government is proposing to give hundreds of millions of dollars to companies for investments they should be making anyway, Luxon said. "We expect those companies to be cutting their emissions without help from taxpayers. A significant part of the Government's plan looks like a corporate carbon bailout. "There are elements of the plan that we welcome, including investment in research to reduce agriculture emissions and in expanding options for carbons sinks including native forests and blue carbon. "However, much of the plan lacks the details we would expect to see after more than two years of work.